Definition of Non-Fungible Token (NFT)
What does the term "non-fungible token" mean? What is meant by a non-fungible token?
With the sudden surge in popularity of products such as "NBA Top Shot" and "CryptoPunks", there has been a great deal of talk about "non-fungible tokens" as of late, and their role in the future of industries such as collectibles and art.
![The Non-Fungible Token meaning when it comes to finance.](https://www.davemanuel.com/images/non-fungible-token.jpg)
To start, "fungible" means "able to replace or be replaced by another identical item".
So, a non-fungible item is NOT able to replace or be replaced by another identical item.
In other words, it is unique.
A non-fungible token is a cryptocurrency token that represents something unique. It is one-of-a-kind and verifies scarcity and ownership.
For instance - if you own a "NBA Top Shot" token, this is a non-fungible token.
For instance, let's say that you own a NBA Top Shot that has these attributes:
Lebron James Dunk vs Minnesota Timberwolves
Limited Edition
50 Copies of This Dunk
Let's say that you own #3 of this limited edition set.
This is a non-fungible token, as it is unique and stands on its own. NOBODY ELSE owns this particular number of this particular set - only you (until you sell it, of course).
This is a non-fungible token. It is easily proven that you own this particular token, and it is easily proven that there are only a limited quantity of this token.
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Bitcoin, on the other hand, is fungible.
For instance, there is no difference between a Bitcoin that was mined three years ago and one that was mined yesterday. It is fungible.
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